Another California city is in financial hot water. Compton joins Stockton, Mammoth Lakes and San Bernardino in considering bankruptcy to deal with spiraling debts.
According to senior officials at a council meeting in Compton last night, the city has a 43 million dollar deficit and has burned through a 22 million dollar reserve fund. Compton has until September 1 to decide on a course of action, when the city will run out of funds to make payroll. This comes amid claims of fraud, misuse of funds and financial waste. The credit reference agency, Standard and Poor's also indicated issues with Compton's finances last week, when it placed a credit watch on some of the city's bonds. S and P has also called for a full, independent financial audit of the city's affairs.
Should bankruptcy be an option for cities in financial trouble? What safeguards should be put in place to protect city funds? What concerns do you have about how officials are managing city dollars? Do you worry that your city could be next?
Guests:
Bob Wieckowski, California Assemblyman (D) representing the 20th District centered in Fremont; Wieckowski authored AB 506 which outlines how California municipalities can pursue bankruptcy; he is also a personal bankruptcy lawyer
Carroll Wills, Communications Director, California Professional Firefighters based in Sacramento